loading...

The ROI of Fundrise

by Mark Wellborn

image
Inside Maketto. Courtesy of Maketto.

Fundrise launched in the summer of 2012 with a fairly focused mission. The online platform would allow the everyday man and woman to invest in local real estate projects for as little as $100, opportunities long limited to larger, institutional investors.

“There should be a model where neighborhoods come together and actually own commercial real estate,” Founder Ben Miller told UrbanTurf shortly before Fundrise launched. “They need to pool capital and take power into their own hands. If they are right, they profit from it.”

The first project open to Fundrise investors was Maketto, the now-open Asian market concept on DC’s H Street Corridor (map) that combines retail, a coffeeshop, and a restaurant on three floors.

Since the Maketto offering, Fundrise has had little trouble attracting investors. In 2013, they raised over $500,000 for a project in Shaw in 24 hours. When Fundrise launched its million-dollar eREIT last year, it sold out within hours and a long waitlist quickly formed. Even UrbanTurf staff got in on the action: our former reporter invested $100 in a project.

The popularity of Fundrise bodes well for its future, but four years after launching, is it making money for investors?

Fundrise projects investors will receive an 8 percent return, distributed quarterly in the first five years of their investment. At the end of year five, the investment principal is projected to be returned to investors. We spoke with two Fundrise investors—one small and one big—to see how their investments have fared over the last few years.

image
The Fundrise investment opportunity in Shaw.

Micah Lubens—Washington, DC—Three Investments

Lubens, a 28 year-old senior project manager, invested $100 in Maketto when Fundrise launched. He has been paid $6.50 in four distributions since his original investment. In 2013, he purchased six shares in 906 H Street NE at $100 a share, and has received three distributions for $12 apiece. Last December, he purchased one share in the eREIT.

While Lubens had doubts about whether Maketto would come to fruition and grew frustrated with the lack of communication from Fundrise as the project progressed, he is generally positive about his investment experience.

“I’ve continued to invest in Fundrise because I believe in the mission of leveling the playing field for real estate investment,” Lubens wrote to UrbanTurf. “It’s also allowed me to learn a lot more about real estate and investing. Before a month or two ago, I didn’t even know what the acronym REIT stood for, so this has been a good opportunity to educate myself.”


Mesh Lakhani—New York—16 Investments

The founder of Future Investor, Lakhani has invested $249,000 in sixteen Fundrise deals. He invests between $10,000 and $25,000 depending on the deal, and prefers short-term debt deals that pay out quarterly. Lakhani has been paid out $16,500 so far, which includes five deals that have already returned principal having closed earlier than their anticipated maturity date.

“Some deals that are active don’t pay out until maturity, so [my returns so far] don’t reflect the actual percentage return on investments,” Lakhani told UrbanTurf. “I’ve calculated annual return on my investments to be 11-12 percent.”

Lakhani, who is 31 and handles his family’s private investments, started investing with Fundrise in 2014. In addition to DC, he has invested in deals in Brooklyn, Seattle and Los Angeles.

“I wanted exposure to direct real estate,” Lahkani said. “It made more sense to diversify across multiple assets, where due diligence was performed by experts versus buying one property myself and having to manage it.”


Are you a Fundrise investor and want to share your experience? Email us at .(JavaScript must be enabled to view this email address).

See other articles related to: fundrise

This article originally published at http://dc.urbanturf.com/articles/blog/the_roi_of_fundrise/10835

0 Comments — Be the First!

Join the discussion

UrbanTurf now requires registration in order to post comments. Register here, or login below if you are already registered.

Click here if you forgot your password.



DC Real Estate Guides

Short guides to navigating the DC-area real estate market

We've collected all our helpful guides for buying, selling and renting in and around Washington, DC in one place. Visit guides.urbanturf.com or start browsing below!

Northern Virginia

Profiles of 14 neighborhoods across Northern Virginia

Ballston
Looking to Give People A Reason to Stay Past 6pm
Clarendon
Happily Straddling the Line Between City and Suburb
Columbia Pike
Arlington’s Neglected Stepchild is Getting a Makeover
Crystal City
Turning Lemons into Lemonade
Lyon Village
Developing An Air of Exclusivity?
Rosslyn
Hitting Its Growth Spurt
Shirlington
An Urban Village Hitting Its Stride
Del Ray
Virginia’s Small Town Near the Big City
Eisenhower Avenue
The Vibrancy Might Take a Few Years
Huntington
The Quiet Neighborhood By the Beltway
Old Town
Mayberry By The Potomac
Parkfairfax
132 Commerical-Free Acres
Downtown Falls Church
Staying the Same in the Midst of Change
Tysons Corner
Radical Change Could Be On The Way

See more Northern Virginia »

Maryland

Profiles of 14 neighborhoods in suburban Maryland

Annapolis
Small-Town Living in the State Capital
Bethesda
Bedroom Community Gets Buzzing Cache
Cabin John
In With The New While Maintaining the Old
Chevy Chase
Affluence, Green Lawns and Pricey Homes
Downtown Silver Spring
Experiencing a Resurgence After a Bumpy History
Potomac
A Suburb on Steroids
Rockville Town Square
Despite the Dynamism, Still Somewhat Generic
Takoma Park
More Than a Little Bit Quirky
Wheaton
A Foodie Magnet on the Verge of Change
Capitol Heights
Kudzu, Front Porches and Crime
Hyattsville
Glass Half Full or Half Empty?
Mount Rainier
Artists, Affordable Homes and A Silo Full of Corn
National Harbor
A Development Rises Next to the Potomac
Riverdale Park
A Town Looking For Its Identity

See more Maryland »

Northwest DC

30+ neighborhood profiles for the city's biggest quadrant

16th Street Heights
DC's Sleeper Neighborhood
Bloomingdale
Where (Almost) Everyone Knows Your Name
AU Park
One of DC’s Last Frontiers Before the Suburbs
Brightwood
DC’s Northern Neighborhood on the Cusp
Burleith
DC’s 535 House Neighborhood
Cathedral Heights
Do You Know Where That Is?
Chevy Chase DC
Not to Be Confused With the Other Chevy Chase
Cleveland Park
Coming Back After A Rough Year
Columbia Heights
DC’s Most Diverse Neighborhood, But For How Long?
Crestwood
An Island of Serenity East of the Park
Dupont Circle
The Best of DC (For a Price)
Foggy Bottom & West End
Where the Institutional Meets the International
Forest Hills
Ambassadors and Adventurous Architecture
Fort Totten
Five Years Could Make a Big Difference
Foxhall Village
350 Homes Just West of Georgetown
Friendship Heights
A Shopping Mecca With a Few Places to Live
Georgetown
History, Hoyas and H&M
Glover Park
One of DC’s Preppier and More Family-Friendly Neighborhoods
Kalorama
A Posh View From Embassy Row
LeDroit Park
A Quiet Enclave in the Middle of the City
Logan Circle
Trendy Now, But Not By Accident
Mount Pleasant
Sought-After Homes Surround Main Street in Transition
Mount Vernon Triangle
From Seedy to Sought-After
Palisades
The Long, Skinny Neighborhood at the City’s Northwest Edge
Park View
It’s Not Petworth
Penn Quarter/Chinatown
DC’s Go-Go-Go Neighborhood
Petworth
Getting a Vibrancy of Its Own
Shaw
The Duke’s Former Stomping Ground
Shepherd Park
DC’s Garden of Diversity
Spring Valley
A Suburb With a DC Zip Code
Takoma
Not To Be Confused With Takoma Park
Tenleytown
Not Quite Like Its Neighbors
U Street Corridor
The Difference a Decade Makes
Woodley Park
Deceptively Residential
Adams Morgan
No Longer DC’s Hippest Neighborhood, But Still Loved by Residents

See more Northwest DC »

Southwest DC

The little quadrant that could

Southwest Waterfront
A Neighborhood Where A Change Is Gonna Come

See more Southwest DC »

Northeast DC

Profiles of 10 neighborhoods in NE

Brookland
New Development Could Shake Up Pastoral Peace
Deanwood
A Little Bit of Country Just Inside the District’s Borders
Eckington
Not to Be Confused With Bloomingdale
H Street
A Place To Party, and To Settle Down
Langdon
The Northeast Neighborhood That Few Know About
Michigan Park
A Newsletter-On-Your-Doorstep Community
NoMa
Evolving from a Brand to a Neighborhood
Rosedale
Ripe for Investment Right About Now
Trinidad
The Difference 5 Years Makes
Woodridge
Big Houses, A Dusty Commercial Strip and Potential

See more Northeast DC »

Southeast DC

6 neighborhoods from Capitol Hill to East of the River

Capitol Riverfront
Still Growing
Hill East
Capitol Hill’s Lesser Known Neighbor
Congress Heights
Gradually Rising
Hillcrest
Notable for Its Neighborliness
Historic Anacostia
Future Promise Breeds Cautious Optimism
Eastern Market
A More European Way of Living

See more Southeast DC »

Upcoming Seminars ▾